Economic Indicators

Consumer Sentiment Reaches Second Highest Reading in 21 Months

According to the University of Michigan Surveys of Consumers, consumer sentiment registered at 69.5 index points. Sentiment reached its second highest reading in 21 months and is now about 39% above the all-time historic low reached in June 2022. According to Surveys of Consumers director, Joanne Hsu, consumers weighed a combination of positive and negative factors in the economy, which led to differing offsetting trends across demographic groups. Consumers perceive that the rapid improvements in the economy from the past three months have moderated, particularly with inflation, and they are tentative about the outlook ahead. Read the full report. 

The Consumer Sentiment Index is a statistical measurement that provides an economic indicator of consumers’ opinion and optimism of the state of the economy. Consumer views over their personal finances haven’t changed much from April, with stable income expectations supporting consumer spending for the time being. 

Michigan Unemployment Rate Slightly Increases in August 2023

Michigan’s August 2023 monthly unemployment rate increased to 3.6% . The national unemployment increased 0.3 percentage points to 3.8% in August, placing Michigan’s unemployment rate slightly below. The Detroit MSA’s unemployment rate increased to 3.0% in July 2023.

Michigan’s labor force participation (LFPR) rate registered at 61.0 in July 2023, up 0.3 percentage points from June, Michigan’s LFPR remains below 0.9 percentage points compared to pre-pandemic levels. The state’s LFPR continues to sit at 1.6 percentage points below the national rate of 62.6 in July 2023.

U.S. Economy Grew at 2.1% Rate in Q2 2023

Real gross domestic product (GDP) increased at an annual rate of 2.1 percent in the second quarter of 2023. In the first quarter, real GDP increased 2.0 percent. The updated estimates primarily reflected downward revisions to private inventory investment and nonresidential fixed investment that were partly offset by an upward revision to state and local government spending. For more information, read the full BEA report.

The GDP is measured as the total market value of the goods and services produced within a specific geography during a given time period. Gross domestic product is a key indicator of the general health of the economy and its performance, with increases indicative of economic growth.

The Detroit MSA’s monthly payroll jobs  increased by 2,000 to 2,032,600  in July 2023, after a decrease by over 500,000 in April 2020 – the lowest level since prior to 1990. Payroll jobs are still below 185,800 compared to July 2019’s pre-pandemic levels.

In Q1 2023, the Detroit Region’s average weekly wage increased by 4.1% from Q4, totaling $1,460. Wages have increased by 18.1% since Q1 2020 indicating a strong labor market.

In Michigan, business applications decreased to 10,837 in July 2023, compared to the pervious month but have increased 12.3% compared to July 2022.

Michigan new business applications have totaled 136,801 in 2022, a 9.1% decrease compared to 2021 levels. While applications might have decreased year-over-year, they were well above pre-pandemic levels. Michigan business applications increased 44.9% compared to 2019 levels, more than 42,360 additional applications were filed in 2022 compared to 2019, indicating strong entrepreneurial activity. Michigan ranked 23rd in business applications per capita in 2022. New business application growth after a recession is a leading indicator of recovery, and often observed after times of economic hardship.

Consumer Sentiment Inched Down in September 2023

According to the University of Michigan Surveys of Consumers, consumer sentiment inched down a scant 1.8 index points this month and has been essentially flat for the past two months.  According to Surveys of Consumers director, Joanne Hsu, sentiment this month was characterized by divergent movements across index components and across demographic groups with little net change from last month. Notably, though, both short-run and long-run expectations for economic conditions improved modestly this month, though on net consumers remain relatively tentative about the trajectory of the economy. So far, few consumers mentioned the potential federal government shutdown, but if the shutdown comes to bear, consumer views on the economy will likely slide, as was the case just a few months ago when the debt ceiling neared a breach. Read the full report. 

The Consumer Sentiment Index is a statistical measurement that provides an economic indicator of consumers’ opinion and optimism of the state of the economy. Consumer views over their personal finances haven’t changed much from April, with stable income expectations supporting consumer spending for the time being. 

Inflation Rate Continued to Rise in August 

U.S. consumer price index (CPI), a key measure of inflation, rose at a 3.7% annual rate in August 2023, marking second acceleration in 14 months. Core CPI, which excludes food and energy, increased 4.3% year over year, core inflation increased 0.3 percent, picking up significantly for the first time since February Read the full report. 

August PMI® contracted in August for the tenth time after 30 consecutive months of growth

The Manufacturing PMI® registered at 47.6% in August, 1.2 percentage points higher than the 46.4% reading in July, according to the Institute for Supply Management® (ISM®).

ISM® states a reading above 50% shows that the manufacturing economy is generally expanding; below 50% indicates that it is generally contracting. The index is based on a monthly survey of supply chain managers and measures general direction of economic trends in manufacturing and other sectors.

Passenger traffic increases at DTW in July 2023 

Detroit Metropolitan Airport experienced a 13.8% increase in total passengers in the month of July 2023 compared to the same month last year. In July, 2.91 million passengers utilized the airport compared to 2.55 million in July 2022. Cargo volumes decreased 25.1% year over year for the month of July 2023. Over 24.8 million pounds cargo were handled by the airport this month.